Monetary Innovations by China to Actively Promote the Internationalization of the Renminbi

Consistent with the official claims, and despite limited success so far, China is gradually and continuously building financial infrastructures to promote the internationalization of the renminbi. While money is a potent instrument of power, this article supports the idea that Beijing will not throw a big overnight financial bang as it would expose its weak domestic financial system. Instead, developing a “3Cs” framework standing for convenience, confidence, and control, we prove that China (i) capitalizes on the global importance of its production tool, (ii) interiorizes the technical expectations of the current international financial system to interoperate with it; (iii) ring-fences its domestic financial sphere from the international one to protect it; and (iv) articulates public/private domestic actors and their technologies to make the use of the renminbi as seamless as possible, being ready when an alternative currency will be required, therefore collecting the fruits of the U.S. sanction policies.